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fxJul 2, 2026, 5:59 AM

EUR/GBP Falls as Softer Eurozone Inflation Dampens ECB Rate Hike Hopes

The EUR/GBP cross dropped to around 0.8565 during early European trading on Thursday, pressured by fading expectations that the European Central Bank will raise interest rates this year following softer Eurozone inflation data.

EURGBP

The EUR/GBP cross weakened to approximately 0.8565 in early European trading on Thursday, extending its decline as softer Eurozone inflation figures reduced pressure on the European Central Bank to hike rates this year.

Market participants are scaling back expectations for ECB tightening, which has weighed on the Euro against the British Pound. The move reflects a shift in rate differential expectations, with the Pound finding support amid a relatively more hawkish Bank of England stance.

No further economic releases were cited in the move, and the cross remains near session lows as traders continue to reassess the rate outlook for both currencies.

Source: FXStreet Forex News